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2018 Stock Market Forecast

2018 Stock Market Outlook

If you’re like me, or any investor for that matter, you are wondering just what the 2018 stock market outlook will be. As they say in the business, past performance is no guarantee of future gains. However, last year the total U.S. stock market was up over 21%. In 2016 the total U.S. stock market was up nearly 13%. So right now we are on a 9-year bull market ride, the longest in history.

But, just how long will that bullish ride continue? Will we make a solid decade-long bull market ride with positive returns in 2018? I am not a prognosticator, but I am certainly bullish on the idea of the 2018 stock market producing double-digit gains for a third year in a row. I do think it will be on the lower side, like 10-12% returns, but that is still tremendous.

With President Trump’s new corporate tax cuts and all the repatriating of corporate money, I think the U.S. stock market is in for another good year, if not two or three. If you don’t believe me, below are some helpful links of others within the financial industry and their 2018 stock market forecast.

2018 Stock Market Forecasts

Yet many bulls point out that there is still much to like about the U.S. right now. There is the potential for a boost to profits from lower corporate taxes. The job market and overall economy continues to hum along. Consumer spending remains resilient too.CNN Money: Can the stock market bull keep raging in 2018?

Bitcoin will “crash”: With the crazy volatility in the cryptocurrency markets over the past few weeks, it’s a pretty safe bet that a serious correction is in the works. A drop of 50% from recent highs around $19,500 would take the digital currency, +5.80% down to just under $10,000 — a figure not that far away after recent declines.MarketWatch: 18 predictions for 2018 on the stock market, FAANGs and bitcoin

Year-end predictions are more art than science. And predicting the future isn’t necessarily Wall Street’s strong suit. At the start of 2017, for example, not a single strategist at 18 top banks saw the Standard & Poor’s 500 stock index rising as much as it has. The average gain predicted was 5.5% and the biggest bull saw stocks rising 12%, according to Bloomberg. If the average prediction had been right, a 401(k) investor with $10,000 invested in the S&P 500 at the start of 2017 would have gained $550. That’s well shy of the market’s actual return of nearly $2,000.USA Today Money: Where the stock market is headed in 2018

Strategists are forecasting the S&P 500 will end 2018 about 4% higher than its current level, according to the median forecast of strategists in a survey conducted by CNBC. Buying into the market when stock prices already are high can be intimidating. But that shouldn’t deter you from participating in what’s proven to be a fantastic long-term investment. The market will go up and down in the course of your investing timeline, but one way to minimize the risk of a big shock to your portfolio is to ensure you’ve spread your money across a variety of assets.NerdWallet: 2018 Stock Market Outlook: More Fear of Missing Out?

For 2018 and beyond, our investment outlook is one of higher risks and lower returns. Elevated valuations, low volatility, and secularly low bond yields are unlikely to be allies for robust financial market returns over the next five years. Downside risks are more elevated in the equity market than in the bond market, even with higher-than-expected inflation.Vanguard: Economic and market outlook for 2018: Rising risks to the status quo

Should investors look for more of the same in 2018? Or is the party nearly over? Not quite yet, according to the Schwab Center for Financial Research’s 2018 Schwab Market Outlook. Global economic growth will likely continue to lift earnings in 2018—but we do appear to be entering the later stages of the market cycle, SCFR says. And with valuations high in both the stock and bond markets, investors should exercise some caution. “We anticipate solid growth in 2018 and don’t see a recession on the horizon,” SCFR experts say. “However, with markets priced for ongoing moderate growth and low volatility, the risks we’re monitoring include the potential for higher inflation and more central bank tightening than expected.”Charles Schwab: 2018 Market Outlook: It’s Getting Late